AIM:XSG

Stock Analysis Report

Executive Summary

Xeros Technology Group plc, together with its subsidiaries, develops and commercializes polymer based technologies to reinvent water intensive industrial and commercial processes by reducing water and chemistry usage in Europe and North America.

Rewards

Trading at 91.4% below its fair value

Revenue is forecast to grow 12.48% per year

Risk Analysis

Shareholders have been substantially diluted in the past year

Currently unprofitable and not forecast to become profitable over the next 3 years

Has less than 1 year of cash runway

Highly volatile share price over past 3 months

+ 2 more risks


Snowflake Analysis

Excellent balance sheet and fair value.

Share Price & News

How has Xeros Technology Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: XSG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-7.9%

XSG

1.2%

GB Machinery

0.1%

GB Market


1 Year Return

-93.0%

XSG

24.8%

GB Machinery

9.8%

GB Market

Return vs Industry: XSG underperformed the UK Machinery industry which returned 24.8% over the past year.

Return vs Market: XSG underperformed the UK Market which returned 9.8% over the past year.


Shareholder returns

XSGIndustryMarket
7 Day-7.9%1.2%0.1%
30 Day11.7%2.1%-0.2%
90 Day-84.1%5.7%2.0%
1 Year-93.0%-93.0%28.4%24.8%15.5%9.8%
3 Year-99.5%-99.5%36.4%25.9%20.1%4.8%
5 Year-99.2%-99.2%60.4%38.0%44.5%11.5%

Price Volatility Vs. Market

How volatile is Xeros Technology Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Xeros Technology Group undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: XSG (£0.01) is trading below our estimate of fair value (£0.12)

Significantly Below Fair Value: XSG is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: XSG is unprofitable, so we can't compare its PE Ratio to the Machinery industry average.

PE vs Market: XSG is unprofitable, so we can't compare its PE Ratio to the UK market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate XSG's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: XSG is good value based on its PB Ratio (0.2x) compared to the GB Machinery industry average (1.8x).


Next Steps

Future Growth

How is Xeros Technology Group forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

68.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: XSG is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: XSG is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: XSG is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: XSG's revenue (12.5% per year) is forecast to grow faster than the UK market (3.6% per year).

High Growth Revenue: XSG's revenue (12.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: XSG is forecast to be unprofitable in 3 years.


Next Steps

Past Performance

How has Xeros Technology Group performed over the past 5 years?

-27.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: XSG is currently unprofitable.

Growing Profit Margin: XSG is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: XSG is unprofitable, and losses have increased over the past 5 years at a rate of -27.6% per year.

Accelerating Growth: Unable to compare XSG's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: XSG is unprofitable, making it difficult to compare its past year earnings growth to the Machinery industry (3%).


Return on Equity

High ROE: XSG has a negative Return on Equity (-227.07%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Xeros Technology Group's financial position?


Financial Position Analysis

Short Term Liabilities: XSG's short term assets (£10.4M) exceed its short term liabilities (£2.8M).

Long Term Liabilities: XSG's short term assets (£10.4M) exceed its long term liabilities (£38.0K).


Debt to Equity History and Analysis

Debt Level: XSG is debt free.

Reducing Debt: XSG has not had any debt for past 5 years.


Balance Sheet

Inventory Level: XSG has a high level of physical assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if XSG's debt is covered by short term assets.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: XSG has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: XSG has sufficient cash runway for 1.438788 years if free cash flow continues to reduce at historical rates of -5.1% each year.


Next Steps

Dividend

What is Xeros Technology Group's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%2.0%markettop25%5.2%industryaverage2.6%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate XSG's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate XSG's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if XSG's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if XSG's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of XSG's dividend in 3 years as they are not forecast to pay a notable one for the UK market.


Next Steps

Management

What is the CEO of Xeros Technology Group's salary, the management and board of directors tenure and is there insider trading?

3.7yrs

Average management tenure


CEO

Mark Nichols (62yo)

4.3yrs

Tenure

UK£704,967

Compensation

Mr. Mark James Nichols has been the Chief Executive Officer of Xeros Technology Group plc since September 14, 2015. Mr. Nichols is a Partner at Scimus LLP. Mr. Nichols has been a Director of Xeros Technolo ...


CEO Compensation Analysis

Compensation vs Market: Mark's total compensation ($USD927.43K) is above average for companies of similar size in the UK market ($USD326.34K).

Compensation vs Earnings: Mark's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.7yrs

Average Tenure

55yo

Average Age

Experienced Management: XSG's management team is considered experienced (3.7 years average tenure).


Board Age and Tenure

2.0yrs

Average Tenure

56yo

Average Age

Experienced Board: XSG's board of directors are not considered experienced ( 2 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: XSG insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUK£50,00020 Nov 19
Mark Nichols
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares5,000,000
Max PriceUK£0.01
BuyUK£50,00020 Nov 19
Paul Denney
EntityIndividual
Role
Member of the Board of Directors
CFO, Company Secretary & Director
Shares5,000,000
Max PriceUK£0.01
BuyUK£50,00020 Nov 19
David Armfield
EntityIndividual
Role
Chairman of the Board
Non-Executive Chairman
Shares5,000,000
Max PriceUK£0.01
BuyUK£50,00020 Dec 18
Mark Nichols
EntityIndividual
Role
Chief Executive Officer
CEO & Director
Shares500,000
Max PriceUK£0.10
BuyUK£50,00020 Dec 18
Paul Denney
EntityIndividual
Role
Member of the Board of Directors
CFO, Company Secretary & Director
Shares500,000
Max PriceUK£0.10

Ownership Breakdown

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 95.3%.


Management Team

  • Mark Nichols (62yo)

    CEO & Director

    • Tenure: 4.3yrs
    • Compensation: UK£704.97k
  • Vik Pratap

    Global Director of Leather Technologies

    • Tenure: 3.7yrs
  • Steve Jenkins (55yo)

    Chief Science Officer

    • Tenure: 0yrs
    • Compensation: UK£114.00k
  • Tony Stewart

    Global Operations Director

    • Tenure: 4.9yrs
  • Ellen Johnson

    PA to Chief Executive Officer

    • Tenure: 3.7yrs
  • Paul Denney (53yo)

    CFO, Company Secretary & Director

    • Tenure: 3.2yrs
    • Compensation: UK£466.63k

Board Members

  • David Baynes (55yo)

    Non-Executive Director

    • Tenure: 0.8yrs
  • Mark Nichols (62yo)

    CEO & Director

    • Tenure: 4.3yrs
    • Compensation: UK£704.97k
  • David Armfield (57yo)

    Non-Executive Chairman

    • Tenure: 0.8yrs
    • Compensation: UK£18.00k
  • Paul Denney (53yo)

    CFO, Company Secretary & Director

    • Tenure: 3.2yrs
    • Compensation: UK£466.63k

Company Information

Xeros Technology Group plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Xeros Technology Group plc
  • Ticker: XSG
  • Exchange: AIM
  • Founded: 2013
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: UK£8.229m
  • Shares outstanding: 783.75m
  • Website: https://www.xerostech.com

Number of Employees


Location

  • Xeros Technology Group plc
  • Advanced Manufacturing Park
  • Unit 2 Evolution
  • Rotherham
  • South Yorkshire
  • S60 5BL
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
XSGAIM (London Stock Exchange AIM Market)YesOrdinary SharesGBGBPMar 2014
XRTE.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDMar 2014

Biography

Xeros Technology Group plc, together with its subsidiaries, develops and commercializes polymer based technologies to reinvent water intensive industrial and commercial processes by reducing water and chem ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/09 21:36
End of Day Share Price2019/12/09 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.